Daniel J. Popeo
R. Shawn Gunnarson
Washington Legal Foundation
2009 Massachusetts Avenue, N.W.
Washington, D.C. 20036
(202) 588-0302
Counsel for Amici Curiae

TABLE OF CONTENTS

TABLE OF AUTHORITIES	iii
INTERESTS OF THE AMICI CURIAE	1
STATEMENT	3
SUMMARY OF ARGUMENT	8
Argument	10
THE MASSACHUSETTS BURMA LAW THREATENS OUR SYSTEM OF DUAL SOVEREIGNTY BY INFRINGING ON THE FEDERAL GOVERNMENT'S EXCLUSIVE AUTHOR- ITY OVER FOREIGN AFFAIRS	10
A.ONLY THE FEDERAL GOVERNMENT HAS THE CONSTITUTIONAL AUTHORITY TO CONDUCT FOREIGN AFFAIRS	12
B. THE MASSACHUSETTS BURMA LAW IS AN UN-CONSTITUTIONAL EXERCISE OF THE FEDERAL GOVERNMENT’S EXCLUSIVE AUTHORITY OVER FOREIGN AFFAIRS
CONCLUSION	33
CERTIFICATE OF COMPLIANCE
CERTIFICATE OF SERVICE

TABLE OF AUTHORITIES

CASES	Page
Barclays Bank plc v. Franchise Tax Board, 512 U.S. 298 (1994)	30, 31
Eastern Enterprises v. Apfel, 118 S. Ct. 2131 (1998)	1
Gregory v. Ashcroft, 501 U.S. 452 (1991)	11
Hines v. Davidowitz, 312 U.S. 52 (1941)	25–26
Holmes v. Jennison, 39 U.S. (14 Pet.) 540 (1840)	24–25
In re Winship, 397 U.S. 358 (1970)	11
INS v. Chadha, 462 U.S. 919 (1983)	11
Kraft General Foods, Inc. v. Iowa Dep’t of Revenue and Finance, 505 U.S. 71 (1992)	2
National Foreign Trade Council v. Baker, 26 F. Supp. 3d 287 (D. Mass. 1998)	7–8, 27
Perpich v. U.S. Dep’t of Defense, 496 U.S. 334 (1990)	1
Principality of Monaco v. Mississippi, 292 U.S. 313 (1934)	10–11
Printz v. United States, 117 S. Ct. 2365 (1997)	20
United States v. Belmont, 301 U.S. 324 (1937)	7, 25
United States v. Pink, 315 U.S. 203 (1942)	7, 26
United States Department of Commerce v. United States House of Representatives, 119 S. Ct. 765 (1999)	1
Zschernig v. Miller, 389 U.S. 429 (1968)	7, 11, 26–27

CONSTITUTIONAL PROVISIONS AND STATUTES MISCELLANEOUS AUTHORITIES

U.S. Const. art. I, § 8	7, 17–18, 29
U.S. Const. art. I, § 10	7, 19–20
U.S. Const. art. II	7, 18–19, 29
U.S. Const. art. VI	28
Massachusetts Act of June 25, 1996 (chapter 130, § 1, 1996 Mass. Acts 210, codified at Mass. Gen. Laws, ch. 7, §§ 22G-22M	passim
The Federalist (Jacob E. Cooke ed., 1961)	passim
Y. Miller, State Rep. Is on Front Line of Burma Struggle, The Ethnic Newswatch (Oct. 9, 1997)	4
Jack N. Rakove, Original Meanings: Politics and Ideas in the Making of the Constitution (1996)	12–14
The Records of the Federal Convention of 1787 (Max Farrand ed., 1966)	14–17, 30, 31
Clinton Rossiter, 1787: The Grand Convention (W.W. Norton & Co. ed., 1987)	17
David Schmahmann and James Finch, The Unconsti- tutionality of State and Local Enactments in the United States Restricting Business Ties with Burma (Myanmar), 30 Vand. J. Trans. L. No. 2 (May 1997)	5
Joseph Story, Commentaries on the Constitution of the United States (Carolina Academic Press 1987) (abridged ed., 1833)	23–24, 29
Mark Thompson, "Local Trade Barriers Under Fire," San Francisco Daily Journal (June 15, 1998)	6

The Washington Legal Foundation (WLF) is a nonprofit public interest law and policy center based in Washington, D.C., with supporters across the nation. WLF regularly appears in legal proceedings before federal and state courts, as well as administrative bodies, to defend the principles of free enterprise and limited government.

WLF has devoted substantial resources to promote limited and accountable government. Through litigation and publishing it has endeavored to prevent government from exceeding its constitutional and statutory authority. To that end, WLF has appeared as amicus curiae before the Supreme Court of the United States and numerous other federal and state courts in cases where states have attempted to usurp the role of the federal government in the conduct of foreign affairs or where foreign affairs considerations figured prominently. See, e.g., Perpich v. U.S. Dep’t of Defense, 496 U.S. 334 (1990).

While WLF has earned a national reputation for steadfastly opposing the federal government’s manifold attempts to unlawfully extend its power, see, e.g., United States Department of Commerce v. United States House of Representatives, 119 S. Ct. 765 (1999) (use of statistical sampling in the national census); Eastern Enterprises v. Apfel, 118 S. Ct. 2131 (1998) (due process implications of retroactive legislation), occasionally a state law poses such an acute threat to our federal system that WLF feels obligated to present its views. See Kraft General Foods, Inc. v. Iowa Dep’t of Revenue and Finance, 505 U.S. 71 (1992) (Iowa’s disparate treatment of corporate dividends from domestic and foreign subsidiaries). This is such a case.

The American Legislative Exchange Council (ALEC) is a nonpartisan membership organization of state legislators who share a common commitment to Jeffersonian principles of individual liberty, limited government, and free markets. ALEC is the nation’s largest bipartisan, individual membership organization of state legislators, with 3,000 members in all 50 states.

ALEC encourages legislators to communicate across state lines, share experiences and ideas, and work in unison with the private sector. Through ALEC, legislators and the private sector work to develop public policies that harness the immense power of free markets and free enterprise to encourage economic growth, increase the nation’s competitiveness, and improve the quality of life for all Americans. ALEC and three of its member legislators join this brief amici curiae in the belief that our nation’s system of governance is based on a delicate balance between the federal government and the governments of the states, each with distinct duties and responsibilities. Attempts by states and localities to conduct foreign policy through economic sanctions and boycotts upset that constitutional balance, destroy American jobs, and hinder the nation’s ability to conduct a coherent foreign policy.

WLF, et al. believe that this brief will assist the Court in resolving the issues before it by contributing a perspective distinct from that offered by any party. Pursuant to Rule 29(a) of the Federal Rules of Appellate Procedure, WLF, et al. submit this brief with the consent of all parties.

STATEMENT

In the interest of judicial economy, WLF incorporates by reference the factual statement as it appears in the district court’s opinion. See National Foreign Trade Council v. Baker, 26 F. Supp. 3d 287 (D. Mass. 1998) (hereinafter cited according to the appendix supplied by Massachusetts). In addition, we wish to emphasize certain aspects of the record.

This case arose when the National Foreign Trade Council (NFTC) brought suit to enjoin the enforcement of the Act of June 25, 1996, chapter 130, § 1, 1996 Mass. Acts 210, codified at Mass. Gen. Laws, ch. 7, §§ 22G-22M [hereinafter "Act" or "Massachusetts Burma Law"). The Act effectively prohibits companies doing business with the Union of Myanmar (formerly known as the Nation of Burma) from providing goods and services to Massachusetts agencies. When a Commonwealth agency negotiates a contract, the Act requires a prospective contractor to provide a statement, under penalty of perjury, detailing the nature and extent of the contractor’s business ties with Myanmar. § 22(H)(c). Except in a few narrowly defined circumstances, see §§ 22(H)(b),(d), a company doing business in Myanmar may not provide goods or services to Massachusetts, and any contract in violation of the statute is void. § 22L.

The Massachusetts Burma Law serves only one purpose, namely, as an attempt to change the domestic policies of Myanmar by discouraging any commerce with that country. See Y. Miller, State Rep. Is on Front Line of Burma Struggle, The Ethnic Newswatch (Oct. 9, 1997) (reporting statement of the Act’s sponsor, state representative Byron Rushing, that Act was a tool "to put pressure on the government of Burma" to allow democratically elected government); Letter from Rep. Rushing to Rep. Hodgkins and Sen. Tolman, Committee on State Administration (Feb. 28, 1995) (stating that "[c]ontinued pressure from Massachusetts is necessary to vigorously combat well-documented repression and intolerance in Myanmar"); see also Compl. ¶¶ 28, 29; House and Senate Debates on H2833). Even more astonishing, the Act’s proponents deliberately tried to fashion a foreign policy distinct from the policy of the United States Government. See, e.g., Signing Statement of Governor William Weld, Commonwealth of Massachusetts, Executive Dep’t Press Release (June 25, 1996) ("[I]t is my hope that other states and the Congress will follow our example, and make a stand for the cause of freedom and democracy around the world").

The Massachusetts Burma Law typifies an unfortunate trend. A growing number of state and local governments have enacted laws and ordinances intended to influence our nation’s foreign policy by sanctioning companies for doing business in disfavored countries. See David Schmahmann and James Finch, The Unconstitutionality of State and Local Enactments in the United States Restricting Business Ties with Burma (Myanmar), 30 Vand. J. Trans. L. No. 2 (May 1997). As one example, Berkeley, California has adopted ordinances prohibiting it from contracting with companies that do business in Myanmar, Nigeria, or Tibet, or that sell hardwood from Brazil, coffee from El Salvador, or redwood from virgin forests. Mark Thompson, "Local Trade Barriers Under Fire," San Francisco Daily Journal (June 15, 1998). Since December 1996, at least 28 states and municipalities have enacted similar laws targeting Nigeria, Switzerland, Indonesia, China, and, of course, Myanmar. Id.

Local attempts to influence the domestic politics of a foreign country predictably backfire. For example, Massachusetts’ foray into foreign relations has already hurt this country’s relations with its chief national defense and trade partners. The European Union has formally protested that the Massachusetts Burma Law violates the World Trade Organization’s (WTO) "Government Procurement Agreement," to which the United States Government is a signatory. Compl. ¶33. Japan has also criticized the law as a violation of international agreements and has requested WTO consultation. ¶ 34. Senior administration officials in the Department of State have understandably voiced concern that laws such as the Massachusetts Burma Law hinder the federal government’s ability to conduct foreign policy. Compl. ¶¶ 37-39.

Ruling on cross motions for summary judgment, the district court granted NFTC declaratory relief. It held that "the Massachusetts Burma Law impermissibly infringes on the federal government’s power to regulate foreign affairs." (A591). The court gave three reasons for its decision.

First, the court noted that "[u]nder our constitutional framework, the federal government has exclusive authority to conduct foreign affairs." (A593). It found ample support for that proposition in both constitutional text, see U.S. Const. art. I, § 8, cls. 1 and 3 (granting Congress authority to provide for the common defense and to regulate commerce with foreign nations); art. II, § 2, cl. 2 (authorizing the President to make treaties and appoint ambassadors); art. I, § 10, cls. 1-3 (prohibiting the states from making treaties, entering into agreements with foreign nations, or imposing duties on imports and exports), and Supreme Court precedent, see United States v. Pink, 315 U.S. 203, 233 (1942); United States v. Belmont, 301 U.S. 324, 331 (1937). (See A593-94).

Second, the court, following Zschernig v. Miller, 389 U.S. 429, 434-35 (1968), determined that "[t]he Massachusetts Burma Law has more than an ‘indirect or incidental effect in foreign countries,’ and a ‘great potential for disruption or embarrassment.’" (A595) (quoting Zschernig v. Miller, 389 U.S. 429, 434-35 (1968)). The court found that the Act was "enacted solely to sanction Myanmar for human rights violations and to change Myanmar’s domestic policies." Id. Moreover, it acknowledged that "[t]he amicus briefs here as well as the Joint Stipulation further demonstrate the Burma Law’s disruptive impact on foreign relations." Id.

The court then finished with a ringing denunciation of the Act:

(A600). Massachusetts then appealed.

SUMMARY OF ARGUMENT

This case is ultimately about the proper allocation of power under our federal system. Massachusetts has enacted a law that first blacklists and then boycotts any business, no matter how otherwise law-abiding, that has the temerity to do business with Myanmar. It enacted the law with the avowed purpose of pressuring the government of Myanmar to renounce its authoritarian ways in favor of democracy. To achieve this goal, Massachusetts has attempted to exert power that the Constitution commits exclusively to the federal government.

Constitutional history, text, and precedent establish that only the United States Government possesses the authority to conduct foreign relations. A trade sanction imposed for the purpose of influencing the domestic policy of a foreign nation, the Massachusetts Burma Law is a classic example of foreign relations. As such, it is nothing less than a frontal assault on the federal government’s authority to devise and implement a coherent foreign policy on behalf of the people of the United States. If the Constitution’s delegation of power over war and peace, ambassadors and treaties, and the regulation of foreign commerce to a single national government means anything, it means at least that states may not use their economic muscle and lawmaking authority to conduct foreign affairs. To ignore this constitutional restraint on state power not only upsets our system of dual sovereignty, it exposes this nation to all the dangers that America faced under the Articles of Confederation. The Founders designed the Constitution to eliminate those dangers by placing the authority to conduct foreign affairs in a strong national government, and the U.S. Supreme Court has repeatedly affirmed that only the federal government has power to conduct foreign affairs.

For these reasons, we urge this Court to repudiate Massachusetts’ attempt to shape an independent foreign policy toward Myanmar. As James Madison wrote long ago, "If we are to be one nation in any respect, it clearly ought to be in respect to other nations." The Federalist No. 42, at 109 (Jacob E. Cooke ed., 1961) (James Madison).

ARGUMENT

THE MASSACHUSETTS BURMA LAW THREATENS OUR SYSTEM OF DUAL SOVEREIGNTY BY INFRINGING ON THE FEDERAL GOVERNMENT’S EXCLUSIVE AUTHORITY OVER FOREIGN AFFAIRS

Defendants-Appellants Laskey and Anderson [hereinafter "Massachusetts" or "Commonwealth") argue that "[t]he Burma Law does not violate any express provision of the Constitution." Br. Defs.-Apps. at 20. "The Constitution does not use the terms ‘foreign relations,’ ‘foreign policy,’ or ‘foreign affairs.’" Id. Partly for this reason, Massachusetts urges this Court to hold that "[t]he Burma Law does not infringe on the federal government’s power to regulate foreign affairs." Id. at 19-20 (capitalization altered). We wholeheartedly disagree.

Whether the Massachusetts Burma Law is unconstitutional ultimately turns on where the Constitution lodges the power to conduct foreign affairs, and that judgment cannot be exclusively confined, even with due regard for judicial modesty, to constitutional text alone. "Behind the words of the constitutional provisions are postulates which limit and control." Principality of Monaco v. Mississippi, 292 U.S. 313, 322 (1934). The Constitution nowhere contains the terms "separation of powers," or "federalism," or even "the rule of law," yet they number among the "essential postulates," id., of that document. See, e.g., INS v. Chadha, 462 U.S. 919, 946 (1983) (separation of powers); Gregory v. Ashcroft, 501 U.S. 452, 457-59 (1991) (federalism); In re Winship, 397 U.S. 358, 384 (1970) (Black, J., dissenting) (the rule of law). The same holds true for the terms "foreign affairs," "foreign relations," and "foreign policy."

"We deal here with the basic allocation of power between the States and the Nation," Zschernig v. Miller, 389 U.S. 429, 443 (1968) (Stewart, J., concurring), a task that holds deep significance for the nation’s constitutional health. "Just as the separation and independence of the coordinate Branches of the Federal Government serve to prevent the accumulation of excessive power in any one Branch, a healthy balance of power between the States and the Federal Government will reduce the risk of tyranny and abuse from either front." Gregory v. Ashcroft, 501 U.S. at 452, 458 (1989) (emphasis added); see also The Federalist No. 31, at 198 (Alexander Hamilton) ("[A] disposition in the State governments to encroach upon the rights of the Union, is quite as probable, as a disposition in the Union to encroach upon the rights of the State Governments"). The Massachusetts Burma Law threatens our system of dual sovereignty because it attempts to conduct foreign policy toward Myanmar—an exercise of power flatly at odds with the allocation of power established by the Constitution. To see that fact more clearly, it is helpful to begin by reviewing America’s experience with foreign affairs under the Articles of Confederation.

"[T]he most serious doubts about the adequacy of the Articles of Confederation arose over the inability of Congress to frame and implement satisfactory foreign policies." Jack N. Rakove, Original Meanings: Politics and Ideas in the Making of the Constitution 26 (1996) (hereinafter Rakove). Those doubts began to arise soon after America signed the peace of 1783 with Great Britain, when it faced three crises in foreign relations.

The peace treaty itself paradoxically led to the first crisis. It entitled American and British creditors to recover good faith debts "with no lawful impediment," id. at 27, and required Congress to get the states to allow British subjects and American loyalists to recover their confiscated property. See id. "Both articles placed Congress in the awkward position of guaranteeing what it lacked the constitutional authority to deliver: the compliance of state legislatures and courts with a national commitment made to a foreign power." Id. The British retaliated by keeping their forts in Oswego, Niagra, and Detroit, along the northwestern frontier, in violation of the peace treaty.

By 1784, a second crisis erupted when Great Britain closed her home island and West Indies ports to American shipping. At the same time, British ships entered American ports at will. See id. "Lacking authority to regulate interstate or foreign commerce, Congress could neither devise nor impose a uniform set of restrictions on British ships. And this constitutional debility in turn diminished the prospects for advancing American trading interests through the negotiation of a satisfactory commercial treaty with Britain . . . ." Id. at 26-27.

The third major foreign policy crisis arose when, in April 1784, Spain barred American ships from entering New Orleans and navigating the lower Mississippi River. See id. at 27. Because there was effectively no American navy to counter Spain’s action, American frontiersmen were cut off from exporting their goods via the Gulf of Mexico. See id. This posed a grave threat to the safety of America’s western territories. As events then stood, "[s]hould the weakness of the Union force western settlers to accommodate themselves to Spain, control of the regions lying between the Appalachian Mountains and the Mississippi would be lost to the United States." Id.

Such foreign policy crises eventually propelled Americans toward a stronger national government:

Id. at 28. However, such reforms "foundered on the requirement of unanimous state ratification," id., until 1787, when delegates gathered at Philadelphia "for the sole and express purpose of revising the Articles of Confederation." 3 The Records of the Federal Convention of 1787, at 14 (Max Farrand ed., 1966) (Resolution of Congress, dated Feb. 21, 1787) (hereinafter Farrand).

On May 29, 1787, Governor Edmund Randolph of Virginia stood in Independence Hall and introduced the Virginia Plan, the basis for the original Constitution. See 1 Farrand, supra, at 18-19. To persuade other convention delegates to abandon the Articles of Confederation in favor of a new form of government, Governor Randolph surveyed "the defects of the confederation." Id. at 18. He named only five, of which two are relevant here. First, Randolph noted that "the confederation produced no security against foreign invasion; congress not being permitted to prevent a war nor to support it by th[eir] own authority. . . . [T]hey could not cause infractions of treaties or of the law of nations, to be punished . . . . [P]articular states might by their conduct provoke war without controul." Second, Randolph observed "that there were many advantages, which the U. S. might acquire, which were not attainable under the confederation—such as . . . counteraction of the commercial regulations of other nations." Id. at 19.

Three weeks later, on June 19^th, James Madison addressed the convention in opposition to the Virginia Plan’s great rival, the New Jersey Plan, which proposed a weaker, more state-centered form of government. See id. at 314-22. Madison’s very first criticisms were directed at that New Jersey Plan’s failure to vest authority over foreign affairs in a strong national government: